The headquarters of the U.S. Department of Health and Human Services is seen in Washington in this file photo.

WASHINGTON (CNS) — Exemptions from the requirement to provide contraceptive coverage under the Affordable Care Act will be simplified to include many more types of religious institutions and accommodate the needs of self-insured church entities that say they must keep a clear financial and functional wall between themselves and the provision of contraceptives.

A new set of proposed rules announced Feb. 1 by the Department of Health and Human Services attempt to accommodate objections raised by Catholic institutions, among others, that said the previous rules would force them to stop providing employee health insurance because the federal requirement to include contraceptive coverage violates their religious beliefs.

The Affordable Care Act includes coverage of contraceptives in all insurance plans. Under what has become known as the contraceptive mandate, the early version of proposed rules for this part of the nationwide health care program mandated all employers provide free coverage of contraceptives for their workers.

The first version of proposed rules for this coverage exempted only religious organizations whose main purpose is the inculcation of faith and who employ and serve members of the faith. A later "accommodation" said nonexempt organizations could do this through third-party insurers.

The expansion would cover religious higher education institutions, health care providers and charitable agencies that do not discriminate on the basis of religion as to whom they serve or employ.

The new proposed rules specify that no exemption will be given to "for-profit, secular employers." Some for-profit entities such as Christian-owned toy retailer Hobby Lobby have sued the federal government over the contraceptive mandate, saying that it violates the religious beliefs of the owners and the faith-based company outlook, and so they should be entitled to a religious exemption.

A brief statement from the U.S. Conference of Catholic Bishops said the conference welcomed "the opportunity to study the proposed regulations closely. We look forward to issuing a more detailed statement later." The Catholic Health Association, which represents Catholic hospitals and health care agencies, also declined to comment on the changes until they were studied.

Others were quick to praise the proposed new rules for addressing the objections of Catholic and other entities, while some found fault with them, saying they would not resolve their objections.

The same day the proposed rules were released they were published in the Federal Register, opening a 60-day period for public comment. The rules are expected to be finalized this summer. Institutions are required to provide the coverage by August.

At a teleconference about the changes, Chiquita Brooks-LaSure, deputy director of policy and regulation in the HHS Center for Consumer Information and Insurance Oversight, said no nonprofit religious institution -- including churches, universities, hospitals and charities — will have to "arrange, contract, pay for or refer for" contraception insurance for employees or students who want it.

Even in the case of self-insured religious entities — which includes many dioceses and colleges — employees or insured students who want contraceptive coverage will be able to arrange it through outside insurance companies, at no cost to themselves and without financial or even administrative support of the faith-based institution, Brooks-LaSure said.

"The eligible organization would have no role in contracting, arranging, paying, or referring for this separate contraceptive coverage," the proposal says. "Such coverage would be offered at no charge to plan participants and beneficiaries, that is, the issuer would provide benefits for such contraceptive services without the imposition of any cost sharing requirement (such as a co-payment, co-insurance, or a deductible), premium, fee or other charge."

The proposal includes several possible ways of arranging such insurance for employees of self-insured organizations.

Brooks-LaSure said that insurers will be able to provide the coverage at no cost to the individual because of the financial savings realized from preventing unwanted or unplanned pregnancies versus paying the costs associated with pregnancy, labor and delivery.

The new proposed rules for exempt religious organizations said that in order to clarify what kinds of organizations may qualify for the exemption, HHS is eliminating the first three prongs of the original four-pronged definition of qualifying religious organizations and clarifying the application of the fourth.

"Under this proposal, an employer that is organized and operates as a nonprofit entity and referred to in (defined sections off the tax code) would be considered a religious employer for purposes of the religious employer exemption," the rules proposal said.

For this purpose, eligible organizations may include "trusts and unincorporated associations, as well as nonprofit, not-for-profit, non-stock, public benefit, and similar types of corporations," it said.

HHS said that by eliminating the first three prongs of the definition of exempt entities, "there no longer would be any question as to whether group health plans of houses of worship that provide educational, charitable, or social services to their communities qualify for the exemption.

The 80 pages of details include a discussion of the 200,000 public comments HHS received on the preliminary rules, giving examples of some of the situations presented for consideration in applying the rules.